Let’s Talk About BOPIS

July 30, 2014

By Lee Peterson

“Buy online, pickup in store.” It’s an ungainly acronym but a very powerful answer to the threat posed by Amazon and other online-only retailers. And it’s a lifeline at a turbulent time for most brick-and-mortar stores.

Here’s a true story I love. A friend of mine needed a new Apple MacBook Pro and a display to go with it. He did his research online, looked at reviews on Amazon, and made the purchase on Apple.com. To complete the transaction, Apple gave him a choice: they could ship it to him (in two days, free of charge) or he could pick it up in the store that afternoon.

Eager to get his new stuff, he drove 25 minutes to an Apple store to claim it. The products were waiting for him – complete with his name printed on the label – less than an hour after he ordered them from his laggy old laptop. Best of all, as he left the store an Apple associate commented, “Hey, this is a big day for you. Nice system!”

In my friend’s mind, Apple had provided immediate gratification — and the warm-and-fuzzy reassurance that if there’s a problem, he could take it right back to the source. In Apple CEO Tim Cook’s mind, his customer had just saved him a pricey international shipping charge.

I love this story because it illustrates several potential advantages for traditional retailers. It’s a great example of customer service – providing options and understanding the customer’s desire to get the product right away. It’s also a story about increased margins, finding a way to use customer impatience to the company’s financial advantage. It shows how a customer will happily use retail’s greatest threat – Amazon – as a source for information but not the final sale, and that a trip to the store was still relevant. And most importantly, it demonstrates that in this era of online disruption, having a physical store presence can be an actual advantage. But the role that store plays must be adjusted.

Usually, I’m very reluctant to use Apple as an example, because in many ways, it’s unfair to use Apple as an archetype…they do so many things uniquely well, and as both manufacturer and retailer, they’re an unusual animal. But in the case of buying online and picking up in store (BOPIS), the way Apple executes this tactic is something everyone in traditional retail must pay attention to and try to emulate. Because, as our research study, The Next Killer App: Stores, has shown, BOPIS is one of the most effective ways retailers can differentiate from, and compete with, Amazon and other major online stores.

BOPIS is the new customer service

Remember when “service” was the most effective way to attract shoppers? Those days, for the most part, are over. Service has been supplanted by convenience. By a significant margin, consumers have told us over and over that they want convenience – and often that means a way of avoiding the hassle of going into an actual store when they already know what they want.

This is a scary prospect for retailers of all colors. Stories, even those designed to provide immersive brand experiences, are rarely designed for convenience. They’re designed to promote sales. To build the basket. To drive shoppers from one end to another in search of the handful of items they need. Most stores have succeeded by providing the opposite of convenience. Online retailing, however, has conditioned shoppers to value convenience over experiences, and they are embracing it.

The research shows that loyalty to Amazon — especially among Prime Users (10 million strong and growing) — indicates not a deep love of the Amazon brand, but the relief from a burden shoppers never wanted to bear in the first place.

In other words, stores need to evolve into, essentially, fulfillment centers to meet the BOPIS opportunity. Stores have already done the hard part: they’ve invested in physical infrastructure (stores) with strategic geographic distribution, and our research suggests that heavy Prime Users are very open to the BOPIS concept, rating it higher in appeal and purchase influence than all other consumer segments divided by generation or gender.

Learn much more

These insights around the competitive advantages of BOPIS just scratch the surface of our new study. Where our previous research effort, Amazon Can’t Do That, explored the ways stores can still differentiate from the online threat, our new report explores the mindset of Amazon’s strongest customers, and the appeal of buying online and picking up in the store. Our findings are both startling and inspiring for retailers seeking a new competitive edge.

Let me finish with a second story about my friend, the same guy who bought the Apple Macbook. Not long after that, he purchased a big LCD TV from Amazon. Read the reviews, chose the one he wanted, and thanks to his Prime membership, had the giant, awkward box delivered to his door two days later. Easy peasy, right?

Right…until the unit starting having trouble. At that point he was on his own. No local store to call or visit for troubleshooting. No easy way to exchange or return it.

“That was the moment,” he told me, “I wish I’d bought it from a store.”